Smaller suppliers and no financial support – the UK's post-Huawei wish list

14 April 2021 | Melanie Mingas

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A report commissioned by the UK government has highlighted the role of smaller telecoms equipment makers in the UK's 5G roll out, while recommending that direct financial support to replace Huawei kit is not necessary.

Carried out by the vendor diversity task force – chaired by Ex-BT CEO and former trade minister Lord Ian Livingston – the report recommended that smaller equipment manufacturers should provide 25% of the equipment used in 5G networks.

"Scale" vendors will also be needed to compete with Ericsson and Nokia. Samsung and NEC could benefit from this.

The new vendor mix would address the gaps left by the ban on Huawei equipment, however the taskforce said direct financial assistance from the government to telcos, in order to cover the estimated £2 billion cost of replacing Huawei kit by 2027, was not necessary.

The third takeaway was that Britain should collaborate with its western allies to develop standards beyond the 5G era.

However, Keystone Law warned that to bring the plans to life, immediate steps must be taken to ensure Standard Essential Patents (SEPs) licenses are made available to all companies requiring one. At present, some owners of SEPs, such as Nokia and Ericsson, "steadfastly refuse to license SEPs to companies that want licenses", the firm said.

IP partner Robert Pocknell explained: "Whilst it is encouraging to see the government is keen to support UK technology companies in this area, if those companies are to be leaders in the future of 5G, then the UK Government needs to take immediate steps to ensure Standard Essential Patents (SEPs) licenses are made available to all companies that want a license, that royalty price lists are made available in accordance with the Supreme Court’s decision in Unwired Planet vs Huawei, and that licenses are granted on fair and reasonable and non-discriminatory (FRAND) terms.

“SEPs are fundamental to the deployment of 5G technology. Unfortunately some owners of SEPs, such as Nokia Networks and Ericsson, steadfastly refuse to license SEPs to companies that want licenses, and many SEP holders seek to charge excessive royalties for use of SEPs. Unless the current licensing environment changes, Huawei, Nokia and others may refuse to license their 5G technology to UK companies, and try to seek injunctions to stop them selling 5G products and services and/or may seek excessive patent licensing fees from companies using 5G networks. This will prevent emerging UK companies from entering the market and hinder the objective of the UK to regain a leading global role in the industry.”